b.e. Term Paper(Vishal)

8/8/2019 b.e. Term Paper(Vishal)

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TERM PAPER

ON

TELECOM INDUSTRY (PESTLE ANALYSIS)

ubmitted To:

Respected Sir Keshri Nandan Chaudhary

ubmitted By:

VISHAL MALIK

MBA)

ECTION- RR1903B43

REGN. NO.10903425

ACKNOWLEDGEMENT


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My project is that the telecom industry. Co-operation and co-ordination of various people is involved in the creation of a proje

mpossible to thank each of them individually, but I am making a humble effort thank some of them.

irst of all I am very thankful of my respected lecturerMR. Keshri Nandan Chaudhary for assigning me such a great project. They n

ssigned me a responsible role in the project but also showed confidence in me throughout the project.

With my immense reverence I express my sincere thanks to Mrs. Rashmi Mittal, Dean Executive of Lovely Professional University forll of us the best possible support.

VISHAL MALIK

CONTENTS


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Introduction

Indian telecom services

Market services

FDI and other activites

Major player of telecon industry

SWOT analysis

Liberalisation

3G tecnology

Growth and revenue

Pestel analysis

Applicability of factor

References


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TELECOM INDUSTRY

INTRODUCTION:

The Indian Telecom sector is third largest network in the world.

Subscriber numbers already crossed 250 million.

Average growth rate of over 40% in respect of subscribers.

Monthly additions of above 7 million phones.

Growth impetus from wireless segment with 84% wireless and 16% wired.

National teledensity at 26%.

Rural teledensity stands at 7%, while the urban at 57%.

Further access is provided by 54 lakh PCOs and 5 lakh VPTs.

9 million Internet and 2.5 million broadband subscribers.

More than a thousand cities have been provided with broadband connectivity out a total of five thousand cities.

Indian Telecom Industry Facts

One of the fastest growing cellular marketsin the world in terms of number of subscriber

additions 261.07 million (March 2008)

Expected to reach total subscriber base of


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about 500 million by 2010 (i.e., more than

one phone for every household)

Annual growth rate of the telecom

subscribers 42 percent (200708)

More GSM subscribers than fixed-line

Subscribers

Total telecom subscribers 300.49 million(March 2008 Cellular + Fixed Line )

Tele density 26.22 percent (March 2008)

Number of new mobile subscribers added

last quarter 27.62 million (March 2008)

ARPU for GSM USD 5.28* (USD./sub/

month)

Telecom equipment market USD 34,100

million (200708)

Handset market USD 7,250 million (200708)

TELEPHONY SERVICES (MOBILE AND BASIC) AND INTERNET SERVICES DOMINATE THE

INDIAN TELECOM SERVICE

The Indian telecom market generated revenues of approximately USD 32 billion in 200708. It registered a CAGR of

approximately 32 percent from 200203 to 200708. The CAGR from 200808 to 201112 is expected to stabilise at 21

percent. Apart from mobile telephony services, other value-added services are also gaining importance

The Indian telecom services can be divided predommantly in to basic, mobile and internet service.it also comprises small

Segments,asia dio paging services, very small aperture terminals(VSATS), Public mobile radio trunked services (PMRTS)

Global mobile personal communication by satellite(GMPCS).

The growth witnessed in the mobile services and internet services segments was much higher as compared to other servic

Such as basic services and radio paging services which are nominal in terms of numbers.

Basic services include fixed wireline andwireless in local loop (WLL-fixed). In 2007

08, basic services subscribers exceeded 60

million.

Fixed wire line services hold a major market

share of 83 percent in basic services.

BSNL and MTNL are market leaders in this

segment.


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Although the government-owned BSNL

dominates the segment in terms ofsubscriber base and market share, private

players have registered a notable growth.


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MOBILE TELECOM SERVICES PROVIDE AN UNPRECEDENTEDGROWTH OPPORTUNITY FOR COMPANIES

1. Mobile services have led to a spectacular growth in the Indian telecom industry.Currently, 12 players are active in this segment. The total number of wireless subscribersescalated to 261.07 million at the end of March 2008, with a monthly addition of morethan 6 million wireless subscribers. Despite the decreasing ARPU*, the minutes of usageis on a rise, which provides impetus to the mobile services growth in India.

2. The declining ARPU implies that India Inc. is tapping a large market at the bottom of the

pyramid by reducing tariffs; thereby, enhancing affordability.

3. Despite a low teledensity of approximately 19 percent, India has the second highest

minutes of usage per

4. The telecom subscriber base has witnessed an explosive growth; the additions in thecurrent year

registered a growth of approximately 47 percent over the previous year.

NOTE- The state-owned BSNL was the second largest service provider after Bharti Airtel

(23 percent) in the Indian wireless telecom market with a market share of approximately

19 percent for the year ending March 2008.


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VARIOUS OTHER SERVICES EMERGED BY LEVERAGING THE TELECOM SERVICES

INDUSTRY

RADIO PAGING:In 1995, radio paging services emerged as a promising segment in India. However, this segment

could not compete with cellular services in general and SMS technology in particular, and is

currently shrinking. At present, only four radio paging service providers are present in the

Indian market

PUBLIC MOBILE RADIO TRUNKED SERVICES:PMRTS have not grown to their expected

potential in India. The high license fee leaves a very thin margin for services providers; thereby,

inhibiting its growth. About 31,000 subscribers are currently availing this service in India from

12 different operators.

GMPCS:

GMPCS services were launched in India in 1999. These services allow a subscriber to

communicate from any

point on earth through a hand held terminal. Moreover, the telephone number remainsunchanged,

Irrespective of the subscribers location.

VERY SMALL APERATURE TERMINAL (VSAT)

The market for VSAT services increased by 5.73 percent during the quarter ending in December

2006, and the segment had a total subscriber base of 55,070. HCL Comnet is the largest of theeight players functioning in the

market.

BROADBAND SEERVICE TO DRIVE INTERNET PENETRATION IN

INDIA

1. The emergence of private players and new technologies have provided a strong impetus to the

growth of Internet and broadband services. The quality and penetration of these services have

undergone changes, with significant improvement in the telecom infrastructure. The Internet

subscriber base registered a CAGR of 60 percent for the period 199798 to 200708.

2. BSNL and MTNL caters to more than two-thirds of Internet subscribers in India.3. The total no. of Broadband Subscribers of these 13 Service Providers have increased from3.1 millon to 3.82

million by adding 0.72 million (23.35%)subscribers in the quarter ending March, 2008.


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4. Private players are catching up fast due to increased penetration of Internet and broadband

services in India

5. The telecom market will experience high penetration of Internet services with the supportfrom government policies and introduction of novel technologies in India

.

INDIAN TELECOM HANDSET MARKET BOOMING ALONG WITH

MOBILE SERVICES INDUSTRIES

1. The Indian handset market grew at a phenomenal rate in 2006 with the sale of

approximately 3035 million handsets. It is estimated that by 2011, sales of mobile

handsets will reach150 million units.

2. Competitive pricing has triggered the growth of coloured handsets, which accounted for

75 percent of the market in2006; whereas, the share of monochrome handsets has

declined to 25 percent.

3. Mobile phones are available at prices as low as USD 1931.

4. Camera phones currently occupy 15 percent of the sales volume.

5. The CDMA category is growing faster than the GSMcategory. It captured 25 percent of

the market volume in

6. 200506 as against a 20.5 percent share in the previous year.Overall, Nokia has a

market share of 53 percent; it dominate the gsm mobile handset with a marketshare ofapproximately 73 percent.

7. The dominate in the CDMA handset market with a maket share of 60 percent

INDIAN: AN IDEAL DESTINATION FOR INVESTEMENT IN TELECOMSECTOR


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Worlds largest democracy

Independent judiciary

Skilled and competitive labour force

Fifth largest telecom network in the world; second largest among the emerging economies

after China

On an average, about 67 million new users added per month, making India the worlds

fastest growing wireless services market

Liberal Foreign Investment RegimeFDI limit increased from 49 percent to 74 percent; the

rural telecom equipment market is also open to large investments

Among the countries offering the highest rates of return on investment

The large untapped potential in Indias rural markets1.9 percent teledensity in rural markets

as compared to the national level of 18 percent

Expected to become the second largest telecom market by 2010

The government promoting telecom manufacturing by providing tax sops and establishing

telecom specific Special Economic Zones

Fully repatriable dividend income and capital invested in telecom equipment manufacturing

IMPORTANT REGULATION AND THEIR IMPACT ON THE INDIAN

TELECOM INDUSTRY

Unified Access Service License Regime (UASL)

Unified licensing marked the end of the license regime in the Indian telecom industry. It helped

in aligning convergent technologies and services. The establishment of the Unified Access

Licensing Regime (2003) eliminated the need for different licenses for different services. Players

are now allowed to offer both mobile and fixed-line services under a single license afterpaying

an additional entry fee. This does not take into account national and international long-distance

services and Internet access services.

ACCESS DEFICIT CHARGE (ADC)

ADC makes it mandatory for a service provider at the callersend to share a percent of the

revenue earned with the service provider at the receivers end in long-distance telephony. This

subsidises the infrastructure costs of the service provider enabling access at receivers end,


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especially because rentalfor fixed-line services is low

UNIVERSAL SERVICE OBLIGATION (USO)

The USO policy was laid along with NTP 99 to widen the reach of telephony services in rural

India. Al telecom operators are bound to contribute 5 percent of their revenues to this fund. This

system was put in place to bridge the wide gap between urban and rural teledensity, bringing it

down from the current 31 percent. Initially, only basic service providers were under the purview

of USO. Later, its scope was expanded to include mobile services also. Although it increases the

cost burden for the telecom companies, USO helps in building the telecommunication

infrastructure in the rural areas.

FDI AND OTHER M&A ACTIVITES INCREASING IN NUMBER

Major trends in the telecom sector is increasing M&A activity, de-regulation of telecom policies

and growing interest of international investors.

VODAFONEVodafone purchased stake in Hutch

from Hong Kong's Hutchison

Telecom International for USD

11.08 billion.

RELIANCEReliance Communications Limited has sold a five percent

equity share capital of its subsidiary Reliance Telecom

Infrastructure Limited to international investors across the

US, Europe and Asia. The deal was worth USD 337.5

million.

TMTelekom Malaysia acquired a 49

percent stake in Spice

Communications for USD 179

million.

MAXIS

Maxis Communications acquired a

74 percent stake in Aircel for USD

1.08 billion

ERICSSON

Ericsson to design, plan, deploy and


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manage Bharti Airtel network and

facilitate their expansion in the rural

areas, under a USD 2 billion

contract.

.

MAJOR PLAYER IN DIFFERENT SEGMENT OF INDIAN TELECOM INDUSTRY

BASIC SERVICES OPERATOR

BSNL

MTNL

RELIANCE

TTSL

INTERNET SERVICE OPERATOR

BSNL

MTNL

RELIANCE

TTSL

AIRTEL


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The Indian telecom industry has a 74 percent FDI limit in the

Telecom services segment.

The Go has permitted 100 percent FDI in manufacturing of

Telecom equipment in India. The Indian telecom industry has always attracted foreign investors. In fact, the

cumulative FDI inflow, during the August1991 to March 2007 period, in thetelecommunication sector amounted to USD 3,892 million. It is the their largestsector to attract FDI in India in the post-liberalization era.FDI calculation takesinto account radio paging, cellular mobile and basic telephone services in thetelecommunication sector

SWOT ANALYSIS OF TELECOM INDUSTRY

Strengths:

Huge wireless subscriber potential.

Fastest growing mobile market in the world.

Consumers are ready to pay for cutting edge Services.

Government proposes to hike FDI limit in Telecom to 74%

Unified license regime.

Weaknesses Lowest call tariffs in the world

Market strongly regulated by Government body

Governing both ISP and Telecom sectors

Too many authorities ruling the sector

Huge potential for low end and cheap handsets

Wide scale Consumer churn in Telecom and ISP

Wide spread VAS deployment is restricted due to

Language and literacy problems

Primarily a voice based market

.

Opportunities

To offer value added services on GSM, CDMA and IP

Language independent services


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Mobile Marketing concepts

Content influenced by local culture and Global success stories

M-Commerce

Unified messaging platforms

Foreign investment in form of equity or technology

Threats

Low cost service providers no possibility of breaking

Even in short term

Weak IPR protection

Software and digital content Piracy

Political instability

Regulatory interference

Liberalisation of telecom industry in India

The Indian government was composed of many factions (parties) which had differentideologies. Some of them were willing to throw open the market to foreign players (thecentrists) and others wanted the government to regulate infrastructure and restrict the

involvement of foreign players. Due to this political background it was very difficult tobring about liberalization in telecommunications. When a bill was in parliament amajority vote had to be passed, and such a majority was difficult to obtain, given to thenumber of parties having different ideologies.

Liberalization started in 1981 when Prime MinisterIndira Gandhi signed contracts withAlcatel CIT of France to merge with the state owned Telecom Company (ITI), in aneffort to set up 5,000,000 lines per year. But soon the policy was let down because ofpolitical opposition. She invited Sam Pitroda a US based NRI to set up a Center forDevelopment of Telemeters(C-DOT), however the plan failed due to political reasons.During this period, after the assassination of Indira Gandhi, under the leadership ofRajivGandhi, many public sector organizations were set up like theDepartment of

Telecommunications (DoT) , VSNL andMTNL. Many technological developments tookplace in this regime but still foreign players were not allowed to participate in thetelecommunications business.

The demand for telephones was ever increasing. It was during this period that the P.NRao led government introduced the national telecommunications policy [NTP] in 1994which brought changes in the following areas: ownership, service and regulation oftelecommunications infrastructure. They were also successful in establishing jointventures between state owned telecom companies and international players. But still
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complete ownership of facilities was restricted only to the government ownedorganizations. Foreign firms were eligible to 49% of the total stake. The multi-nationalswere just involved in technology transfer, and not policy making.

During this period, the World Bank and ITU had advised the Indian Government toliberalize long distance services in order to release the monopoly of the state owned DoT

and VSNL; and to enable competition in the long distance carrier business which wouldhelp reduce tariff's and better the economy of the country. The Rao run governmentinstead liberalized the local services, taking the opposite political parties into confidenceand assuring foreign involvement in the long distance business after 5 years. The countrywas divided into 20 telecommunication circles for basic telephony and 18 circles formobile services. These circles were divided into category A, B and C depending on thevalue of the revenue in each circle. The government threw open the bids to one privatecompany per circle along with government owned DoT per circle. For cellular servicetwo service providers were allowed per circle and a 15 years license was given to eachprovider. During all these improvements, the government did face oppositions from ITI,DoT, MTNL, VSNL and other labor unions, but they managed to keep away from all the

hurdles. After 1995 the government set up TRAI (Telecom Regulatory Authority of India) which

reduced the interference of Government in deciding tariffs and policy making. The DoTopposed this. The political powers changed in 1999 and the new government under theleadership ofAtal Bihari Vajpayeewas more pro-reforms and introduced betterliberalization policies. They split DoT in two- one policy maker and the other serviceprovider (DTS) which was later renamed as BSNL. The proposal of raising the stake offoreign investors from 49% to 74% was rejected by the opposite political party and leftistthinkers. Domestic business groups wanted the government to privatize VSNL. Finally inApril 2002, the government decided to cut its stake of 53% to 26% in VSNL and to throwit open for sale to private enterprises. TATA finally took 25% stake in VSNL.

This was a gateway to many foreign investors to get entry into the Indian TelecomMarkets. After March 2000, the government became more liberal in making policies andissuing licenses to private operators. The government further reduced license fees forcellular service providers and increased the allowable stake to 74% for foreigncompanies. Because of all these factors, the service fees finally reduced and the call costswere cut greatly enabling every common middle class.family in India to afford a cellphone.

Growth of mobile technology

India has become one of the fastest-growingmobile markets in the world.The mobileservices were commercially launched in August 1995 in India. In the initial 56 years theaverage monthly subscribers additions were around 0.05 to 0.1 million only and the totalmobile subscribers base in December 2002 stood at 10.5 millions. However, after the
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number of proactive initiatives taken by regulator and licensor, the monthly mobilesubscriber additions increased to around 2 million per month in the year 2003-04 and2004-05.

Although mobile telephones followed the New Telecom Policy 1994, growth was tardyin the early years because of the high price of handsets as well as the high tariff structure

of mobile telephones. The New Telecom Policy in 1999, the industry heralded severalpro consumer initiatives. Mobile subscriber additions started picking up. The number ofmobile phones added throughout the country in 2003 was 16 million, followed by 22million in 2004, 32 million in 2005 and 65 million in 2006. As of January 2009, totalmobile phone subscribers numbered 362 million, having added 15 million that monthalone. India ranks second in mobile phone usage to China, with 472 million users as ofSeptember 2009.

India has opted for the use of both the GSM (global system for mobile communications)andCDMA (code-division multiple access)technologies in the mobilesector. In additionto landline and mobile phones, some of the companies also provide theWLL service.

The mobile tariffs in India have also become lowest in the world. A new mobile

connection can be activated with a monthly commitment of US$0.15 only. In 2005 alone32 million handsets were sold in India. The data reveals the real potential for growth ofthe Indian mobile market.

In March 2008 the total GSMand CDMA mobile subscriber base in the country was 375million, which represented a nearly 50% growth when compared with previous year.

In April 2008 the Indian Department of Telecom(DoT) has directed all mobile phoneservice users to disconnect the usage of unbranded Chinese mobile phones that do nothave International Mobile Equipment Identity (IMEI) numbers, because they pose aserious security risk to the country. Mobile network operatorstherefore planned tosuspend the usage of around 30 million mobile phones (about 8 % of all mobiles in the

country) by 30 April.

EMERGING TECHNOLOGY: 3G AND WiMAX

The Indian government auctioned the spectrum for 3G services by inviting bids from Domesticas well as foreign players and creating a competitive environment that offers better Services toconsumers in January 2008. Therefore, the 3G spectrum is among the major Investmentopportunities and growth drivers of the telecom industry.

The immense potential for 3G is reflected by the 3040 percent annual growth inValue-

Added Services. Cell phone manufacturers are striving to develop USD 100 priced 3G handsets for the

Indian

Market.

India expects to replicate its 2G growth in 3G services.

MTNL has soft launched its 3G service and calls it MTNL 3G Jadoo.
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WiMAX has been one of the most significant developments in wireless communication

in the recent Past. Since this mode of communication provides network access in

inaccessible locations at a speed Of more than 4 Mbps, it is expected to be a major factor

in driving telecom services in India, especially Wireless services. Thus, it will lead to the

increased use of telecom services, Internet, value-added Services and enterprise services.

WiMAX is expected to accelerate economic growth and assist in providing better

education, healthcare and entertainment services.

It is estimated that India will have 13 million WiMAX subscribers by 2012.

Aircel is the pioneer in WiMAX technology in India.

The state-owned player, BSNL, aims to connect 74,000 villages through WiMAX. Bharti, Reliance and VSNL have acquired licenses in the 3.3GHz range to utilise the

opportunities Offered by this domain.

COMPOSITION OF NET SERVICE REVENUES


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Revenue and growth

The total revenue in the telecom service sector was Rs. 86,720 crore in 2005-06 asagainst Rs. 71, 674 crore in 2004-2005, registering a growth of 21%. The total investmentin the telecom services sector reached Rs. 200,660 crore in 2005-06, up from Rs. 178,831crore in the previous fiscal.

Telecommunication is the lifeline of the rapidly growing Information Technologyindustry. Internet subscriber base has risen to 6.94 million in 2005- 2006. Out of this 1.35million werebroadband connections. More than a billion people use the internet globally.

Under the Bharat Nirman Programme, the Government of India will ensure that 66,822revenue villages in the country, which have not yet been provided with a Village PublicTelephone (VPT), will be connected. However doubts have been raised about what it

would mean for the poor in the country. It is difficult to ascertain fully the employment potential of the telecom sector but the

enormity of the opportunities can be gauged from the fact that there were 3.7 millionPublic Call Offices in December 2005 up from 2.3 million in December 2004.

The value added services (VAS) market within the mobile industry in India has thepotential to grow from $500 million in 2006 to a whopping $10 billion by 2009.

PESTEL Analysis of telecom industry

Political factors, are how and to what degree a governmentintervenes in the economy.Specifically, political factors include areas such as tax policy, labour law, environmental

law,trade restrictions, tariffs, and political stability. Political factors may also includegoods and services which the government wants to provide or be provided (merit goods)and those that the government does not want to be provided (demerit goods or meritbads). Furthermore, governments have great influence on the health,education, andinfrastructure of a nation.

Economic factors include economic growth, interest rates, exchange rates and theinflation rate. These factors have major impacts on how businesses operate and makedecisions. For example, interest rates affect a firm's cost of capital and therefore to what
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extent a business grows and expands. Exchange rates affect the costs of exporting goodsand the supply and price of imported goods in an economy companies have usedtelecommunication to help build global empires. This is self-evident in the case of onlineretailer but according to academic Edward Lenert, even the conventional retailer hasbenefited from better telecommunication infrastructure compared to its competitors. In

cities throughout the world, home owners use their telephones to organize many homeservices ranging from pizza deliveries to electricians. Even relatively poor communitieshave been noted to use telecommunication to their advantage. In Bangladesh's Narshingdidistrict, isolated villagers use cell phones to speak directly to wholesalers and arrange abetter price for their goods. In coffee growers share mobile phones to follow hourlyvariations in coffee prices and sell at the best price.

Social factors include the cultural aspects and include health consciousness, populationgrowth rate, age distribution, career attitudes and emphasis on safety. Trends in social

factors affect the demand for a company's products and how that company operates. Forincreasing the cost of labor). Furthermore, companies may change various managementstrategies to adapt to these social trends (such as recruiting older workers).Telecommunication is playing an increasingly important role in social relationships. Inrecent years, the popularity ofsocial networking sites has increased dramatically. Thesesites allow users to communicate with each other as well as post photographs, events andprofiles for others to see. The profiles can list a person's age, interests, sexuality andrelationship status. In this way, these sites can play important role in everything fromorganizing social engagements to courtship. Prior to social networking sites, technologieslike SMS and the telephone also had a significant impact on social interactions. In 2000,market research group Ipsos MORI reported that 81% of 15 to 24 year-old SMS users in

the United Kingdom had used the service to coordinate social arrangements and 42% toflirt.

Technological factors include ecological and environmental aspects, such asR&Dactivity, automation, technology incentives and the rate oftechnological change. Theycan determinebarriers to entry, minimum efficient production level and influenceoutsourcing decisions. Furthermore, technological shifts can affect costs, quality, andlead to innovation. technological change in the telecom and computer have radicallychange in business scenario in turn the new demands of business have spurred manytelecom technological innovation in order to exploit these innovation for completing inglobal market business community the world over has been putting pressure ongovernment to revise the policy regulation and structure of the telecom sector.severalcountry across the world have responded by restructuring the state controlled telecomservice provider increasing private participation and deregulating service provision.

Environmental factors include weather, climate, andclimate change, which mayespecially affect industries such as tourism, farming, and insurance.Furthermore, growingawareness to climate change is affecting how companies operate and the products theyoffer--it is both creating new markets and diminishing or destroying existing ones.
http://en.wikipedia.org/wiki/Electricianhttp://en.wikipedia.org/wiki/Bangladeshhttp://en.wikipedia.org/wiki/Bangladeshhttp://en.wikipedia.org/wiki/Social_networking_sitehttp://en.wikipedia.org/wiki/Social_networking_sitehttp://en.wikipedia.org/wiki/Short_message_servicehttp://en.wikipedia.org/wiki/Ipsos_MORIhttp://en.wikipedia.org/wiki/Flirthttp://en.wikipedia.org/wiki/R%26Dhttp://en.wikipedia.org/wiki/R%26Dhttp://en.wikipedia.org/wiki/Automationhttp://en.wikipedia.org/wiki/Technological_changehttp://en.wikipedia.org/wiki/Barrier_to_entryhttp://en.wikipedia.org/wiki/Barrier_to_entryhttp://en.wikipedia.org/wiki/Outsourcinghttp://en.wikipedia.org/wiki/Innovationhttp://en.wikipedia.org/wiki/Climate_changehttp://en.wikipedia.org/wiki/Climate_changehttp://en.wikipedia.org/wiki/Electricianhttp://en.wikipedia.org/wiki/Bangladeshhttp://en.wikipedia.org/wiki/Social_networking_sitehttp://en.wikipedia.org/wiki/Short_message_servicehttp://en.wikipedia.org/wiki/Ipsos_MORIhttp://en.wikipedia.org/wiki/Flirthttp://en.wikipedia.org/wiki/R%26Dhttp://en.wikipedia.org/wiki/Automationhttp://en.wikipedia.org/wiki/Technological_changehttp://en.wikipedia.org/wiki/Barrier_to_entryhttp://en.wikipedia.org/wiki/Outsourcinghttp://en.wikipedia.org/wiki/Innovationhttp://en.wikipedia.org/wiki/Climate_change


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Legal factors include discrimination law, consumer law, antitrust law,employment law,andhealth and safety law. These factors can affect how a company operates, its costs, andthe demand for its products.

Applicability of the Factors

The model's factors will vary in importance to a given company based on its industry and thegoods it produces. For example, consumer and B2B companies tend to be more affected by thesocial factors, while a global defense contractor would tend to be more affected by politicalfactors. Additionally, factors that are more likely to change in the future or more relevant to agiven company will carry greater importance. For example, a company who has borrowedheavily will need to focus more on the economic factors (especially interest rates).

Furthermore, conglomerate companies who produce a wide range of products (such as Sony,Disney, or BP) may find it more useful to analyze one department of its company at a time withthe PESTEL model, thus focusing on the specific factors relevant to that one department. Acompany may also wish to divide factors into geographical relevance, such as local, national, and

global.

REFERENCE

1. PESTLE analysis history and application, CIPD. Retrieved 2009-10-21.2. PEST: Political, Economic, Social, and Technology Analysis". The Decision Group.

http://www.decide-guide.com/pest.html. Retrieved 2009-01-27.3. PESTEL analysis of the macro-environment". Oxford University Press.

2007.http://www.oup.com

4. http://economictimes.indiatimes.com5. http://www.trai.gov.in6. Government of India : Economic survey7. BSNL
http://en.wikipedia.org/wiki/Discrimination_lawhttp://en.wikipedia.org/wiki/Consumer_lawhttp://en.wikipedia.org/wiki/Antitrust_lawhttp://en.wikipedia.org/wiki/Employment_lawhttp://en.wikipedia.org/wiki/Employment_lawhttp://en.wikipedia.org/wiki/Health_and_safety_lawhttp://en.wikipedia.org/wiki/Health_and_safety_lawhttp://en.wikipedia.org/wiki/Business-to-businesshttp://www.cipd.co.uk/subjects/corpstrtgy/general/pestle-analysis.htmhttp://www.cipd.co.uk/subjects/corpstrtgy/general/pestle-analysis.htmhttp://www.decide-guide.com/pest.htmlhttp://www.decide-guide.com/pest.htmlhttp://www.oup.com/uk/orc/bin/9780199296378/01student/additional/page_12.htmhttp://economictimes.indiatimes.com/http://www.trai.gov.in/http://en.wikipedia.org/wiki/Discrimination_lawhttp://en.wikipedia.org/wiki/Consumer_lawhttp://en.wikipedia.org/wiki/Antitrust_lawhttp://en.wikipedia.org/wiki/Employment_lawhttp://en.wikipedia.org/wiki/Health_and_safety_lawhttp://en.wikipedia.org/wiki/Business-to-businesshttp://www.cipd.co.uk/subjects/corpstrtgy/general/pestle-analysis.htmhttp://www.decide-guide.com/pest.htmlhttp://www.decide-guide.com/pest.htmlhttp://www.oup.com/uk/orc/bin/9780199296378/01student/additional/page_12.htmhttp://economictimes.indiatimes.com/http://www.trai.gov.in/

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